Poor sentiment hits rally prospects

Poor sentiment hits rally prospects

TOKYO (AFP): Depressed regional sentiment looked set to
nullify the customary rally ahead of the Lunar New Year
celebrations as markets generally lost ground Friday amid a
weakening Indonesian rupiah, dealers said.

The rupiah, which hit a historic low of 16,500 to the U.S.
dollar on Thursday before recovering to end the week at around
13,000 in Asian trading, has given a sharp blow to overall
regional confidence.

Despite the regional turmoil, Japanese share prices staged a
quick 2.3 percent bounce on bargain-hunting and futures-linked
buying by foreign investors, which dispelled the otherwise
cautious mood ahead of the weekend amid the sustained slide of
the rupiah, brokers said.

The key Nikkei stock average of 225 selected issues on the
Tokyo Stock Exchange ended 383.42 points higher at 16,789.11,
after touching the high of 16,797.10 near the close.

The Nikkei 225 index rallied more than four percent over the
past week.

In Hong Kong, shares closed 0.4 percent higher on a technical
rebound, dealers said.

Dealers said the region had little comfort to offer with the
Indonesian rupiah testing a new low, adding that the local
rebound might not be sustained.

The key Hang Seng index gained 36.47 points to close at
8,920.20 points.

In Singapore, share prices closed 0.8 percent weaker, but off
their lows, as lingering concerns over the crisis in Indonesia
and higher interest rates weighed on investors.

"That breath of fresh air from the IMF and the promised
reforms have become yesterday's news," said Glen Ow, dealer of
Ong and Co., referring to an agreement Jakarta inked with the
International Monetary Fund this month promising to implement
reforms.

Sentiment over Indonesia was unlikely to improve until after
the Indonesian presidential election in March, he added.

The benchmark Straits Times Industrials index fell 9.66 points
to 1,259. 83, while the broader All-Singapore index was lower by
4.11 points to 371.66.

In Sydney, Australian share prices rose 0.9 percent as a
buoyant resource sector surged in late trade, outweighing poor
performances by several leading bank issues.

The Australian Stock Exchange's main indicator, the All
Ordinaries index, rose 23.9 points to 2,623.3.

In Kuala Lumpur, the key stock index closed 2.9 percent lower
as investors squared positions ahead of a long break for the
Chinese Lunar New Year holidays, dealers said.

The Kuala Lumpur Stock Exchange's 100-share weighted composite
index fell 16.64 points to end at 558.57, off an earlier low of
548.61. A senior dealer at a local brokerage said a mild
technical rebound helped lift the market off earlier lows.

In Bangkok, Thai shares posted marginal gains, closing 0.5
percent higher as investors waited for the outcome of
negotiations between Finance Minister Tarin Nimmanahaeminda and
the IMF, dealers said.

The Stock Exchange of Thailand (SET) composite index rose 2.07
points to finish at 422.87 points, while the selected SET 50
index added 0.16 points to 31.45.

In Manila, Philippine share prices slipped 0.2 percent on a
falling peso and the weakness of regional bourses and currency
markets, analysts said.

"The volatility of regional currencies and markets will
continue to have a major effect on Philippine capital markets,"
said Spencer Yap of BPI Securities.

The Philippine Stock Exchange composite index fell 3.54 points
to close at 1,704.07.

In Seoul, share prices closed 0.6 percent higher on the Korea
Stock Exchange in volatile trade on foreign buying support for
blue chips, dealers said.

Dealers said the market witnessed a "dogfight" between sellers
and buyers throughout the day.

"Seoul appeared to be afraid of the regional market woes
yesterday but today it was not," said Yu Ji-Eun, a dealer with
Samsung Securities.

The composite index closed up 2.87 points at 486.86.

In Shanghai, the B shares, nominally reserved for foreign
investors, rose 3.1 percent on institutional buying of
heavyweight stocks, analysts said.

The Shanghai Stock Exchange's B share index rose 1.42 points
to close at 46.92 points while the A share index of locally-
traded stocks rose 19.21 points, or 1.5 percent, to 1,293.78
points.

In Taipei, the Taiwan stock market was closed for the Lunar
New Year holiday. Markets will resume trading on Feb. 2.

In Auckland, New Zealand share prices closed barely higher on
the back of a rebound by Telecom Corp., brokers said.

The NZSE-40 capital index rose one point to 2,245.92.